On Tuesday, officials broke ground on the KCI Intermodal BusinessCentre near the 112th Street exit off Interstate 29. The project will consist of warehouses and offices on property owned by the airport with some buildings having direct runway access.
Alan McArthur/Landmark photo

Ground was officially broken for the new Kansas City Intermodal BusinessCentre on Tuesday on Kansas City International Airport property in Platte County.

The site is near the 112th Street exit along I-29 Highway near the American Airlines overhaul base.

The development is for 800 acres along Prairie View Road and south of the overhaul base to Tiffany Springs Parkway.

The first phase consists of 180 acres along Prairie View Road and is expected to cost around $16 million in infrastructure. Improvements at the site have already begun and are expected to continue through May 2009. The project will provide warehouse and office space as well as airside and aircraft apron access.

The development was the target of controversy earlier this year while legislators in Jefferson City were working on legislation to remove the tax on lease agreements for businesses on airport owned property. Originally, the legislation was titled House Bill 1836, but text was later added to Senate Bill 711 and approved.

Platte County R-3 Superintendent Mark Harpst even spoke against the legislation. The school districts later negotiated with Kansas City officials and came to an agreement in principle. The agreement would pay the Park Hill School District 10-cents per square foot of each building constructed on airport property. The R-3 district would receive 9-cents per square foot.

The total square footage for the first two phases would be around 5.4 million and would yield $540,000 for Park Hill. There are currently no buildings planned in the R-3 district.

Before the ground breaking on Tuesday, several local officials spoke to those in attendance at the event.

“In this economy, this sends the right signal that, yes, it is a time to go forward and make investments,” said Mark Funkhouser, Kansas City mayor.

“KCI continues to be concerned about jobs at the American Airlines overhaul base,” said Ed Ford, councilman. “Private development will inject jobs into this area.”

“My hat goes off to the aviation department,” said Wayne Cauthen, city manager. “I am looking forward to the 24/7 movement of dirt here.”

“The City of Kansas City, Missouri is committed to transforming Kansas City International Airport into a major center for manufacturing, intermodal shipping and commercial development,” said Mark VanLoh, director of the Kansas City Aviation Department. “This partnership is the next step in our plan to leverage KCI's strategic location to attract jobs and industry to our community.”

The major sponsor for the legislation to help spur the development was Timothy Flook, state representative for District 34 in Clay County.

“Prosperity drives revenue, not tax increases,” said Flook. “There are thousands of acres of empty land here and now we've got an open for business sign here. Kansas City, in nearly 40 years, has never had development here.”

Flook pointed out that school districts will still receive tax revenue from all equipment in the buildings and once the construction costs are recouped, then businesses will pay taxes on the real estate leases.

“The school districts will see more money and not have to raise taxes to do it,” said Flook.

The agreements between the school districts and the city have still not been officially signed, according to Chris Byrd, an attorney for Kansas City.

“We are waiting for feedback from the school districts,” said Byrd. “They have had them over a month. I thought we'd have feedback by now. I don't think there will be any major changes in it.”

Byrd said he was unsure when the agreement would be officially signed. The agreements will still need to be signed by the city council and then the individual school district boards of education.

Currently there are only two phases listed to be developed at the airport by Trammell Crow.

Other projects planned at the airport include a race track along the west side of the airport; however VanLoh said that currently the economy is putting those plans on hold.

According to David Hinchman, vice president of CB Richard Ellis, there are currently no tenants scheduled to fill the buildings.

“We are in discussions with different tenants,” said Hinchman.

The first building to be constructed on the site will be the LogisticsCentre I with a total square footage of 494,000, the building can then be added onto for an additional 494,000 square feet. The project calls for a total of 17 buildings on the site with four of those in the first phase.

The buildings are being constructed by the Trammell Crow Company with similar projects in Dallas/Ft. Worth and Houston, Texas, Portland, Ore., and in Calgary, Alberta, Canada.